September 12, 2017 / 4:08 AM / 10 months ago

PRECIOUS-Gold prices ease as investors look to riskier assets

    * Gold, silver hit lowest since Sept. 1
    * Dollar index pulls away from 2-1/2 year low hit last week
    * Spot gold may drop to $1,317/oz - technicals

 (Adds comment, updates prices)
    By Apeksha Nair
    Sept 12 (Reuters) - Gold prices hit their lowest in over a
week on Tuesday, as a lull in geopolitical tensions spurred a
pick-up in investor appetite for riskier assets such as
    Asian shares marked a 10-year peak early in the day and the
dollar held gains, with investors breathing a sigh of relief as
fears over North Korea eased slightly and the worst-case
scenario from Hurricane Irma looked to have been avoided.
    Spot gold        dipped 0.1 percent to $1,325.11 an ounce by
0615 GMT, after earlier touching its lowest since Sept. 1 at
    The metal fell 1.4 percent in the previous session, its
biggest one-day percentage decline since early July.
    U.S. gold futures         for December delivery were down
0.4 percent at $1,330.40.
    "The lack of an expected North Korean missile launch, and
expectations that Hurricane Irma will have less of an impact
than previously anticipated led to a rekindling of 'risk-on'
sentiment," said John Sharma, economist at National Australia
    Irma, earlier ranked as one of the most powerful Atlantic
hurricanes on record, was downgraded to a tropical storm on
Monday after wreaking havoc across Florida.             
    Fears over North Korea receded slightly after the nation
marked its founding day without further nuclear tests. 
    The United Nations Security Council unanimously stepped up
sanctions against North Korea over the country's sixth and most
powerful nuclear test on Sept. 3, imposing a ban on the
country's textile exports and capping crude oil
    "We expect continued - although somewhat restrained - demand
for gold due to continued economic and geopolitical uncertainty,
which should keep gold slightly above $1,300/oz in the near
future," Sharma added.      
    Spot gold may drop to $1,317 per ounce, as it has broken
support at $1,332, said Reuters technical analyst Wang Tao.
    "We suspect that the dollar rally could have more room to
run ... we could see a retracement in the precious metal to
around $1,310-$1,315 before an element of underlying support
sets in," INTL FCStone analyst Edward Meir said in a note.
    A stronger greenback makes dollar-denominated gold more
expensive for holders of other currencies.
    However, analysts at Bank of America Merrill Lynch said in a
note on Monday that the U.S. currency could remain supportive
for gold, with the precious metal on track to hit its $1,400 per
ounce target in coming months.
    In other precious metals, silver        was down 0.2 percent
at $17.77 an ounce after having earlier hit its lowest since
Sept. 1
    Platinum        was down 0.2 percent at $988.05, while
palladium        was 0.7 percent higher at $938.25 an ounce.

 (Reporting by Apeksha Nair in Bengaluru; Editing by Joseph
Radford and Richard Pullin)
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